John Oliver from Last Week Tonight on HBO had a segment the other night that made me want to go all Tom Cruise on Oprah’s couch. If you’ve ever wondered how credit repair works, and even if it’s legal, or just sensed that there is something sleazy about the debt collection industry, this clip is a must watch.
I was really busy yesterday, but I knew something was big when I got tagged several times on Facebook. Then my friend and business accountability buddy Dara from Paper Zero – Eliminate Paper and Make Bookkeeping a Breeze IM’d me from the airport at 9pm and told me to finish watching it. Dara doesn’t mess around and when a Canadian is IM’ing you about American debt, you listen up.
Here is the highlight reel, but it’s worth watching the whole thing.
John Oliver was appalled at the debt industry in the US and decided to send some under cover agents to do some exploring. His team caught a debt collector on camera saying they find out who people’s bosses are and then call the bosses at home and tell them about a debt of their employee. Guess what? You’re protected under the Fair Debt Collections Practices Act, and calling your boss is illegal, not to mention calling your boss at home.
(This guys favorite thing to do is call people’s bosses. At home)
His also played recordings of debt collectors saying they were going to shoot people’s dogs.
That’s right. Shoot your dog.
I was texting about this with a friend this morning who told me that she had a debt collector calling her landlord about her ex husband’s debt that she was not legally responsible for (don’t worry. We are getting this fixed for her.)
Point being, the examples are endless and egregious.
The most appalling thing though is the way that debt gets bought and sold on the market. It’s literally at best an Excel spreadsheet with the details of your account and your Social Security Number. Someone might buy the debt for a pennies on the dollar, and then be allowed to collect the full amount of the debt. You can’t even settle your debts in bankruptcy at the rates the debt collectors can buy the debts.
(If you ever feel bad or have questioned the integrity of settling a debt, this is something to keep in mind. If you defaulted on a credit card, the bank has written that debt off, got a full tax break for the amount, and then sold, as in made a profit, to a debt collector. That debt collector can collect the debt they bought for $100 for the full $1000.)
I thought one of the more appalling parts was when they took undercover cameras to a debt collecting convention in Las Vegas. The tone that was used to talk about people speaks everything about the industry. How to convince the courts you’re the good guy…..
The worst part is the industry is highly unregulated. They estimated that one lawyer spent 4 SECONDS looking at a case before they brought it to court, and then they win by default because people don’t answer the summons.
*insert dramatic music here*
That’s where John Oliver put on his Superman cape.
He incorporated a business on the internet in a state he had never visited and then bought 15 million (let’s pause to look at the digits here….$15,000,000 dollars) for $60,000. That’s less than half a penny on the dollar. The best part was, this is zombie debt, meaning too old to be legally sued on.
And then he forgave it. All of it. 15 million dollars of it.
I love you John Oliver.
You can watch the whole thing here.
If you’ve got any of these issues, we are here to help whenever you’re ready. I’m also building a digital DIY credit repair course coming out this summer, so stay tuned.
Ps. As I put this digital course together, I would love to hear what about your credit causes you the most anxiety or stress and how you think your life could be different if you didn’t have those issues haunting you. It would really help me prepare this course. Post below or IM or email me.